Transcript Communicating

MBA
Marketing Management
MKT 600
Promotion & Communication
Promotion Mix
Lecture Overview
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Introduction
Communications Theory
– Communication Process
– Hierarchy of Response Models
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Communication Objectives
Designing a Message
– Choosing the right Channel
– Scheduling
– Budgeting
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Promotional Tools/Techniques
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Persuasion Swing
Advertising
PR
Sales Promotion
Sponsorship
Personal Selling
Direct Marketing
INTRODUCTION
Having the right product available at the right time and at the right price still may not
achieve a sale because the potential customer may not know of the offer. To be
successful companies need therefore to communicate their offer.
Since early days, individuals have used hand signals, sounds, symbolic drawing and
facial expressions for the purpose of communicating some form of message to one
another.
Today the exchange of information takes place through sophisticated media, such as,
interconnecting computers, telephones, text, TV and radio etc. An efficient network of
communication is essential for successful promotional activity. It enables the company
not only to communicate with its customers but also hold up an image with its markets at
large. Such an image will help others to form perceptions and beliefs about what the
company stands for and will influence their attitudes and future behaviour in dealing with
it.
For marketing purposes, communication of products and services contributes to the
persuasion process to encourage the customer to avail themselves of whatever is on
offer.
COMMUNICATIONS THEORY
For organisations to be successful they need to communicate their offer to their target
markets (audience). The process entails sending messages through various channels or
media to create awareness and understanding of why they might wish to buy a particular
product. The process itself is highlighted below;
Communication Process
Sender
Receiver
Receiver
Response
All communication requires a response of some sort. Unfortunately, the response
is not always what we expect.
Organisations are the senders in the communications process and consumers are the
receivers. A sender will put information in a form that a receiver will understand. This
might involve a visual, verbal or written message to transmit the ideas. This process is
called encoding. The sender will choose a particular medium or channel to carry the
message to the receiver (eg television, radio, newspapers etc). The consumer
interprets the message through a process called decoding. If the consumer interprets
the message as required, it should impact on the receiver and lead to a response
indicated by the feedback as shown over.
Message
Sender
Encode
Decode
Sender
Channel
Message
Noise
Feedback
Unfortunately, there is no guarantee the receiver will receive the full message or even
understand it fully. This is because of the of interference with the flow of the information
which is called noise.
Noise acts as a barrier to the flow and understanding of the information and can include;
other competing communication drowning out your information, or it might be poor
presentation of the message in terms of the words, visuals or even media chosen to
carry the message.
To improve the chances of a message getting through it may be necessary to change
the format of the message and repeat the message several times rather than rely on
one transmission
Hierarchy of Response Models
These models attempt to predict the sequence of mental stages that the consumer passes
through on the way to purchase. As you pass through each stage your propensity to buy
increases.
Behavioural
Stage
Aida
Adoption
Dagmar
Unawareness
Cognitive
Knowledge
(awareness)
Attention
Awareness
Awareness
Affective
Liking and
Beliefs
Interest
Interest
Comprehension
Desire
Evaluation
Conviction
Information
Stage
Trial
Conative
Behaviour
Tendency to
Buy or try
Action
Adoption
Action
Persuasion
Stage
COMMUNICATION OBJECTIVES
Once the target audience has been defined, marketing communicators must decide; what
is our objective? What response is sought? The objectives will in part be based around
the buyer’s readiness stages previously discussed.
Objective
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Awareness
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
Knowledge
Liking
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Preference
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
Conviction
Purchase
- to build awareness for a new product may begin with simple
messages that repeat the company name or product name.
- to increase knowledge about the product or products on offer.
- this presumes there is some knowledge and awareness for the
product. This is about creating interest for your product.
- building customer preference by promoting the products quality,
value etc.
- getting the customer to trial the product/taste it.
- finally getting the customer to buy the product.
NB: Communication on its own cannot create positive feelings and purchase for a
product. It requires the support of the whole marketing mix to do this. It can, however,
speed up the demise of a product.
DESIGNING A MESSAGE
Ideally a message should grab attention, hold interest, arouse desire and obtain action
(purchase), ie AIDA model.
In putting a message together, the marketer must decide:
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
What to say?
How to say it?
– message content
– message structure and format
Message Content
Content relates to an appeal or theme that will produce a desired response.
Rational Appeal
Emotional
- emphasises functional benefits, ie better performance, higher
quality, economy eg Volvo crumple zones.
- stirs up negative or positive emotions that can motivate purchase.
This includes; fear, guilt and shame appeals. (Crest, ‘only toothpaste
to protect teeth from cavities’) but also love, humour, pride and
promise of success appeals. (Haagen Dazs – pleasure appeal ie
‘Now it’s on everyone’s lips’)
Moral Appeal
- Directed at an audience’s sense of what is right and proper. Often
used by charities and voluntary organisations.
Message Structure
Do not put too much detail into an advertisement. Keep your key messages to 1 maybe 2.
Don’t dilute the message. Decide on a headline, illustration and colour to attract attention. Use
different sounds to project message on radio or TV.
Choosing the right Channel
Important to choose the right channel to reach the target audience (eg young people tend
to frequent the cinema, fashion conscious women read specialist magazines,
professional people read trade/professional magazines/broadsheet newspapers,
commuters listen to the radio going to work.
Scheduling
Schedules are designed to achieve the optimum number of viewing by members of the
target audience. The measure is of opportunities to see (or hear) O.T.S.
Learning theory suggests the best learning is cognitive – individuals restructure their cognition
with regard to given problem situations and this restructuring leads to greater insight – simply
put, the more times and ad is seen, the greater the reinforcement – a form of parrot fashion
learning.
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Question – Should an ad campaign concentrate ads over a short period (burst
scheduling) or over a longer period (drip scheduling)?
Budgeting
All campaigns need to be costed to assess the effectiveness in reaching its target audience
(eg TV is very expensive, but can be offered on a regional as well as national basis. It may
become even more competitive with digital TV.) £100K budget would be insufficient for TV
advertising, but £1M would allow the use of TV nationally.
John Wanamaker, an American department store manager once said,
' I know half my advertising is wasted, but I don’t know which half!’
Promotion spending in some industries is highly significant, eg cosmetic industry spending
is 20-30% of sales while in others, industrial machinery may be less than 5% of sales.
Budget Methods Used
Affordable Method – What the company can afford. Problem with this method is it ignores
the effect of promotion on sales.
Percentage of Sales Method – (ie 5% of sales revenue will be budgeted). This method is
simple to use and makes managers think about the relationship between promotion and
selling.
Problems relate to:
 It views sales as the cause of promotion, rather than opportunities
 It fails to consider spending higher or lower levels of spending
 Does not explain what percentage level is appropriate
Competitive Parity – Setting budget to match competitors. This is reasonable in way it
represents the collective wisdom of the industry. But why should the competitor know best?
Objective Methods – Sets budget based on what it wants to achieve. Good for making
managers define their objectives, but problems exist because it is difficult to implement.
PROMOTIONAL TOOLS/TECHNIQUES
The promotional mix comprises all the marketing and communication tools used to achieve
the promotional objectives. The diagram below shows a complete range of tools that can be
used to influence a customer or potential customer.
Promotional influences on the customer
Advertising
The
Customer
Merchandising
Internal marketing
The influence the different tools have on the consumer s are indicated on the Persuasion Swing below –
Attention
Interest
Desire
Action
Advertising
P.R.
Sponsorship
Sales promotion
Selling
Persuasion Swing
Advertising
Definition: ‘Any paid form of non-personal presentation and promotion of ideas, goods
or services by an identified sponsor.’
Objectives – To create awareness, inform about a feature or benefit, remind, reassure,
create an image and sometimes to encourage trial of support a sale.
Copy – Copy lines are words of an advertisement that are crucial to its understanding and
impact on its target audience. Agencies employ copywriters to develop effective copy lines.
3 types of copywriter – apprentice, journeyman and master.
 Apprentice attends award dinners
 Journeyman receives the awards
 Master sends regrets from Bahamas – they are too busy to attend.
Media
Broadcasting
Print
Direct Mail
Outdoor
- TV, radio, cinema
- Magazines, newspapers
- House to house drops, postal service, internet
- Posters, hoardings, advertising on buses, trains, taxis, as well as new
signs and electronic screens.
Public Relations
Definition: Building good relations with the company’s various publics by obtaining
favourable publicity, building a good corporate image and handling favourable stories
and events.
The role of PR is to create and maintain goodwill and mutual understanding between the
company (or person) and its publics. It is different from advertising, in that, it is not paid for
directly, and it is focused more on behavioural change.
Opinion Leaders
Community
Potential Employees
Consumers
Public
Employees
Distributors
Money Markets
Suppliers
Change Attitudes
From:
Negative
to
Positive
Hostility
to
Sympathy
Prejudice
to
Acceptance
Apathy
to
Interest
Ignorance
to
Knowledge
Media Relations - Maintain positive contact with journalist – press releases, articles.
Lobbying - Seeking to influence people in authority in order to secure support and achieve a
desired action (political lobbying NW Tourist Board).
Crisis Management - Involves using PR operations to handle any problem that may arise.
Corporate Identity Programmes –
Special Events –
Design of Logos
Literature
Corporate Livery
Stationery
Annual Reports
Web site
Conferences
Community Programmes
Sponsorship
Internal Newsletter/House Magazines
Sales Promotion
Definition: Short term incentives to encourage the purchase or sale of a product or
service.
Sales promotion is clearly geared towards the persuasion stage of the adoption/process. In
seeking customer action buy NOW rather than later.
Objectives -
To achieve awareness and interest, but moreover, desire.
To get customers to switch their buying
To buy more (ie 3 for the price of 2)
To smooth out seasonal dips in demand
Sales Promotional Tools -
Samples – trial offers
Coupons – saves off future purchases
Cash refund offers
Price packs (multi-buys)
Premium offers
Price reduction – 20% off
Patronage rewards – points
Competitions
Tailor made – charity donation, stock up ahead of promotion,
test drive.
Activity – take 15 mins to consider how you would use sales promotion to achieve each of
the tailor-made examples above
Sponsorship
Definition: Sponsorship is the provision of resources to build a relationship of mutual
benefit.
True sponsorship is expressed in the phrase ‘enlightened self interest!’
A cause is supported with cash in return for satisfactory specific corporate and PR marketing
objectives.
Type of Sponsorship
Example
Personality
Bodies
Titles
Events
Individual sports people sponsoring kit manufacturer
Sports teams play with sponsored name on kit
Nationwide Football League
Cadbury sponsor Christmas shows in UK theatres. Martell
sponsors the Grand National
ATP tennis sponsored by Mercedes
Budweiser sponsor the Kick Off in American Football
Pizza Hut promised every spectator at the Pittsburgh Pirates
Baseball game a free soda/pizza if a spectator chosen at
random could catch 3 popping balls. All 3 were caught and
33798 people shared a pizza to the value of £150,000.
international headlines more than justified the cost.
Tournaments
Happenings
Creations
Personal Selling
Definition: the presentation of products and associated persuasive communications to
potential clients, employed by the supplying organisation.
Different Types
Order taker
Deliverer
Missionary
Technician
Demand Creator
- shop assistant/sales order office clerk
- van driver
- builds goodwill, creates ideas and gains specifications in
medical/architectural type markets.
- provides technical advice and support for major purchase
decisions – technical consultants
(ie computers/telecommunications)
- Merchandiser/seller.
Key objectives/Sales tasks
Prospecting
Communicating
Servicing
Information gathering
Allocating
Selling
- looking for sales leads
- providing information
- providing service
- market intelligence
- allocating scarce resources
- getting the order
Sales Approach
Product Knowledge
Opening
Establish needs
Presentation
Objection handling
Closing
Follow up
- know your product features and benefits
- act professionally – gain interest
- re-establish what customer wants, ie ask questions
- a review of what you can offer to meet their needs
- chance to review customer needs and reinforce why your
product/service is superior
- asking for the order/and follow up
- checking to make sure customer received the
product/service they wanted-chance to get another order.
Negotiations
Definition: Conferring with another with a view to compromise. Negotiation as with
selling is the only promotional vehicle that truly offers 2 way communication
between the seller and the buyer.
Advantages and Disadvantages
Advantages
Disadvantages
High level of customer attention
Can customise message
Immediate feedback
Lots of technical detail can be explained
Can demonstrate product
Can develop long term relations
Expensive
Difficult to interact with more than one
buyer at a time.
Time consuming
Direct Marketing
Definition: ‘the planned recording, analysis and tracking of customer behaviour to
develop relational marketing strategies.’
Components
Direct Mail
Telemarketing
- Main medium direct response advertising good for personalising
messages, testing messages and is not as visible to competitors as
is advertising. The main problem is direct mail does not allow for
sound or movement.
- Used a lot with financial services as link ups with direct mail
campaigns. Good for immediate 2 way communications. Quick and
accurate, flexible tool. Good for building and cleaning data and bases
and for;
Market evaluation and test marketing
Dealer support
Traffic generator
Account servicing
Customer care and loyalty building
The Internet
Enhances customer service and promotes marketing relationships. Can be used for direct
sales or for directing the viewer to some other media.
Can be interactive in gaining further information about the customer.
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Rules to consider –
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Internet ads need to seize viewers attention
Long download times will encourage the viewer to switch
Selling must offer price savings
All must cross promote sites
Catalogue Marketing
On-line Marketing – with the explosion of PCs and the internet at home this type of service
offers on line information and marketing services free of charge for many customers.
Commercial one line services – are by subscription. The best known are America On Line,
CompuServe and Prodigy who have 12 million subscribers.